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Lesson Plan:Health InsuranceSubmitted by Marcia Allen, Murphysboro High School, Murphysboro, Illinois. Ms. Allen is a 2002 graduate of theInsurance Education Foundation (IEF), Insurance Education Institute at Illinois State University, Normal, Illinois.For more information on the Insurance Education Foundation, access the following Web Site: http://www.ief.org/Subject:Consumer EconomicsGrade Level:11 - 12Length:One Class PeriodObjective:Students will be able to apply their knowledge of health insurance definitions by takingscenarios and determining the cost to the consumer and the cost to the insurancecompany.Materials:Student - pen or pencil, page of scenarios and worksheetsTeacher - copies of scenarios, transparency and overhead projectorBackground:Students will have completed health insurance vocabulary assignments found in mosttextbooks.Activities:The teacher will present an example of how deductibles, co-insurance, stop loss points,limits of policy, and exclusions are applied in a health insurance problem.Show-Me Standards: For more information access the MO Department of Elementary and SecondaryEducation website at: http://www.dese.mo.gov/standardsKnowledge Standards:Communication Arts (1, 2, 6)Health/Phys Ed. (6)Mathematics (1, 3)Science (8)Social Studies (4)Performance Standards:1-5, 1-8, 1-10, 2-3, 2-7, 3-1, 3-2, 3-4, 3-5,3-6, 3-7, 3-8, 4-1, 4-5, 4-6

Scenario:Nathan has the following healthinsurance policy: 250 deductible 80/20 co-insurance 2,000 stop loss limit (amountto which insurance is applied) 1,000,000 limit of policyNathan had a skate boarding accidentand the bill was 40,250. How much did Jim pay? How much did the insurancecompany pay?

Break it down: 40,250 Cost of Accident250 Deductible 40,0002,000 Stop Loss Point 38,000x 2,000 Stop Loss Point0.20 Nathan's % 400x 2,000 Stop Loss Point0.80 Insurance Co.'s % 1,600NathanPaysInsuranceCo. Pays 250Deductible 0 400Co-Insurance 1,600 0 Stop Loss point met 38,000 650Total 39,600

Scenario Worksheet:Directions: Determine what each person and each company will payCase #1Case #2Case #3Manuel has the following health insurance:Tenisha has the following health insurance:Greta has the following health insurance:Hometown Pride Insurance CompanyDazzler Insurance CompanyCrimson & Corn Insurance CompanyIncludes:Includes:Includes: Basic health insurance (hospitalization,surgical, outpatient coverage, alsoknown as physician expense).Major medical insurance withprescription coverageExcludes: Vision and dental coverage Basic health insuranceMajor medical insurance withprescription coverageDental policy that covers two cleaningsper yearVision coverage that covers one eyeexam and 75% for glasses or contactlensesBasic health insuranceMajor medical insurance with aprescription card ( 15 generic, 25brand name)Excludes: Vision and dental coverageThe basic health and major medical insuranceincludes a 250 deductible, 80/20 coinsurance, up to 500 preventative care paidat regular rate (no preventative care coverageover 500), 1,000 stop loss point, and 1million maximum.Insurance includes a 1,000 deductible, 70/30co-insurance, preventative care paid up to 250 at 100% with no co-insurance ordeductible applied (no preventative carecoverage over 250), 5,000 stop loss point,and .5 million maximum.Manuel had the following bills throughout theyear:Tenisha had the following bills throughout theyear:Greta had the following bills throughout theyear:Jan.:Jan.:Teeth cleaned ( 48)March: Annual physical and office visit( 300)June:Appendectomy ( 5,000)July:Teeth cleaned ( 48)Aug.:Eye exam ( 50) and new glasses( 200)Sept.:Office visit ( 40)Feb.:April:May:June:Insurance includes a 500 deductible, 80/20co-insurance, 2,500 stop loss point, and a 1million maximum.April:May:June:July:Dec.:Office visit for sore throat ( 40);prescription, brand name ( 50)Office visit and allergy shot ( 60)Annual eye exam, replace broken eyeglasses ( 250)Teeth cleaned ( 48)Broken arm – x-rays, surgeon’s fee,cast, etc. ( 4,000)Teeth cleaned ( 48)Teeth cleaned ( 48)Annual physical and office visit ( 250)Office visit ( 40)Major skiing accident, hospitalized withintensive care, etc. ( 300,000)Sept.: Teeth cleaned ( 48)Oct.: Vision check and new contact lenses( 200)Nov.: Sore throat, office visit ( 40);prescription, generic ( 35)

Case #1 Calculation Space:Office Visit (sore throat)PrescriptionOffice Visit (allergy shot)Broken ArmTotal medical expensesDeductibleStop Loss point 500 Deductible 405060 4,000 4,150500 3,650- 2,500 1,150Manuel PaysCase #2 Calculation Space:PhysicalAppendectomyOffice VisitTotal Medical ExpensesDeductibleStop Loss Point2 teeth cleanings covered at 100%Eye exam covered at 100%New glasses covered at 75% 250 DeductibleTenisha Pays 3005,000 40 5,340- 250 5,090- 1,000 4,090Case #3 Calculation Space:Office Visit 40Accident300,000 40Office Visit 300,0801,000Deductible 299,0805,000 294,080 96 50200x 0.75 150Greta Pays: 1,000 Deductible 500 for co-insurance (20% of Stop Lossamount) 200 for co-insurance (20% of Stop LossAmount) 1,500 for co-insurance (30% of Stop LossAmount) 96 for dental (not a covered expense) 50 (25% of new glasses) 96 for dental (not a covered expense) 250 for vision (not a covered expense)Total: 500 200 for vision check and contact lenses (not acovered expense)Total: 1,346 15 for generic prescription co-payTotal: 2,811Hometown Pride Insurance Co. Pays 2,000 for co-insurance (80% of Stop LossAmount) 1,150 Stop Loss Point MetTotal: 3,150Dazzler Insurance Pays 800 (80% of Stop Loss Amount)Crimson & Corn Insurance Pays 3,500 (70% of Stop Loss) 4,090 Stop Loss Point met 294,080 Stop Loss Point met 96 for dental 20 for generic prescription co-pay 50 for eye exam 250 for annual physical 150 (75% of new glasses)Total: 297,850Total: 5,186